Spending on demand planning tools to rise

Tuesday, September 10, 2013

Spending on demand sensing and planning applications is expected to grow in the next two years, according to a new report from IDC Manufacturing Insights.
The study, IDC MarketScape: Worldwide Manufacturing Supply Chain Demand Sensing and Planning 2013 Vendor Assessment, assesses how a number of information technology vendors will take advantage of that growth, namely Infor, JDA Software, Kinaxis, Logility, Oracle, SAS, SAP, and Steelwedge.
IDC said investment growth in demand planning IT is being driven by several factors, depending on the type of manufacturer.
“For some manufacturing sub-verticals like engineering-oriented value chains, volatility manifests itself in the form of supply complexity,” IDC said. “For other sub-verticals like brand-oriented value chains, volatility manifests itself in the form of demand complexity. For still others like technology-oriented value chains, it’s both. The result has been a renewed focus on demand planning and a desire to improve their forecasting capabilities and performance."
IDC projects growth in demand planning applications will outstrip overall manufacturing supply chain management spending by more than 1 percent, with demand sensing and planning applications currently accounting for 8.5 percent of overall supply chain management spending. The number is forecast to climb to 8.7 percent by 2015.
“Indications are good for a continued strong future for supply chain demand sensing and planning applications in manufacturing – particularly in those sub-segments like consumer products and high tech where companies experience high levels of demand volatility,” said Simon Ellis, IDC practice director, in a statement. “Manufacturers who better leverage demand sensing and planning technology to deliver consistently against their service obligations, whilst maintaining required cost levels, will strengthen their current market positions and will be more viable in the long term.” - Eric Johnson